Abstract Establishment of a proper balance of excitatory and inhibitory (E/I) connectivity is achieved during development of cortical networks and adjusted through synaptic plasticity, but there are fundamental gaps in our understanding of how this process is regulated. Without further characterization of developmental synapse remodeling, our understanding of neuropsychiatric disorders associated with GABAergic inhibitory connection disruption such as schizophrenia and autism is limited. The purpose of this research is to characterize molecular mechanisms that establish E/I balance in the prefrontal cortex, which may identify novel targets for treatment of disorders in which E/I balance is altered. The specific goal of this proposal is to define a mechanism for limiting inhibitory connections between GABAergic basket interneurons and pyramidal neurons. The central hypothesis of this proposal is that neural cell adhesion molecule NCAM and tyrosine kinase EphA3 form a presynaptic receptor complex for postsynaptic ephrinA5 to promote elimination of perisomatic synapses during early postnatal development of the prefrontal cortex (PFC). I also hypothesize that formation of perineuronal nets (PNNs) in later postnatal development of the PFC terminates NCAM/EphA3-mediated basket cell remodeling. To address these hypotheses, I will (1) characterize the importance of NCAM/EphA3 binding by using non-binding mutants in functional assays including receptor clustering, downstream EphA3 signaling, and growth cone collapse, (2) determine whether Neurocan competitively inhibits binding of NCAM/EphA3, (3) develop novel mouse models to conditionally delete NCAM in cortical neurons and assess perisomatic synapse remodeling using live two-photon imaging, and (4) test whether PNNs prevent remodeling of basket cells in brain slices. The findings of these studies are expected to be of great value to our understanding of novel molecular mechanisms of synapse remodeling of GABAergic interneurons in postnatal PFC and could provide insight into the etiology of neurological disorders involving E/I balance disruption.